Friday, May 2, 2008

Inhale recession

If you are a consistent reader of my sporadic blog then you’ll know that a few days ago I fixed our immigration problem quite eloquently and without any hard feelings.

Today, I will eloquently fix the economy -- again, without any hard feelings.

First, we have to define a few things.

Recession: A period of general economic decline; specifically, a decline in GDP for two or more consecutive quarters.

GDP: The total market value of all final goods and services produced in a country in a given year, equal to total consumer, investment and government spending, plus the value of exports, minus the value of imports.

So, how do you increase GDP? You legalize marijuana. If you are really brave you just legalize all drugs for private consumption and for distribution. But, for now, let’s just legalize marijuana.

Marijuana is the 4th largest cash crop in America. And American law enforcement is spending $10 billion annually to outlaw the plant.

In 1997, the United States harvested 5.5 million pounds of marijuana worth $15.1 billion to growers and $25.2 billion on the retail market.

I’d be willing to bet that these numbers have increased in the last 11 years.

So, would an estimated $30 billion in sells help the GDP? If it were legal, would we be able to grow more? How much could we export to other countries where marijuana is legal?

I bet we could still tax it like a cigarette. The price would still be much cheaper than the illegal variety and the government would be able to collect revenue from this $25.2 billion in sells. But, the $25.2 billion number is from the illegal business and from 11 years ago! If the government imposed a 5% tax rate on marijuana sells today and let’s just provide a modest guess that legal marijuana sells today would be at $35 billion, that’s $1.75 billion in tax income!

And, my friends, that’s only the sells of the plant itself. When marijuana is legalized, I personally will buy tons of stock in the snack food industry whose sells are bound to go through the roof!

1 comment:

  1. You're just cranky cuz you don't like paying so much for your pot supply and are hoping a free market supply will make it cheaper for you. If you weren't such a hopped up pothead you'd know that making pot legal and adding $30 billion to the economy wouldn't be but a small blip in the big pie. And you forget, pot already contributes handsomely to the economy. The underground illegal part. Legalizing the stuff would likely cause a recession.